ALEXEI KUDRIN PLAYS AMERICAN BALL — STRIKES OUT, AGAIN

Every autumn, as regularly as trees change their colour, Alexei Kudrin (lead image), the one-time finance minister of Russia, attempts a putsch. And as regularly as leaves fall to the ground, he fails to seize the high office he thinks he deserves.

Counting the number of self-advertisements he has issued, Kudrin is the longest loser in Russian politics. Compared to other proteges of Anatoly Chubais – men like Mikhail Abyzov[1], Leonid Melamed[2], Valentin Zavadnikov[3], Alfred Kokh[4], Vladimir Kogan[5] — Kudrin has managed to accumulate a relatively small fortune. He is also the only minister of state whom President Vladimir Putin has publicly diagnosed[6] as having had an “emotional breakdown”. What Putin meant is that a Russian apparatchik who keeps failing to grab power and wealth, both, when opportunity knocks, must be psycho.

Between July and September of 2011 Kudrin announced he should be prime minister. At the time Putin was prime minister preparing to take the presidency back the following March, and return Dmitry Medvedev to the prime ministry. Kudrin arranged for the western media to announce his bid, telling the Wall Street Journal[7] “several members of Moscow’s elite business and economic circles have suggested that Mr. Putin may run for president and, when he’s inaugurated, select longtime Finance Minister Alexei Kudrin as the country’s next prime minister”.

Exactly what he would do differently revealed who was supporting him, and who was against him – Kudrin was opposed to increasing the defence side of the budget; he was in favour of more state bank credit to the oligarchs. “This [the Army budget] is a very significant increase,” Kudrin declared through a Finance Ministry release, “I think it creates additional risks for the budget, as well as for macroeconomics.” At the end of September, when Kudrin was rallying US support for himself in Washington, declaring he would not agree to serve if Medvedev was reappointed, Medvedev sacked him.

On September 26, in front of running cameras, Medvedev explained the start of electioneering in Russia was having “an impact on people’s emotional state.” Medevedev added there was “an entire class of people who, for some reason, tend to travel across the ocean to make their important statements”. Medvedev meant the US and Kudrin. He was blunt – Kudrin’s campaign against military spending and promotion for himself would not be tolerated. “There is no such thing as the new government. Noone has been handed an invitation to join…All matters of government spending, including defence allocations, carry the signature of the Finance Minister.” If Kudrin intended to rebel, Medveded added, he “could have made his views known at an earlier date… [Kudrin’s] statements made in the United States were inappropriate and inexcusable.”

When Medvedev demanded that Kudrin “give an answer here and now”, Kudrin escalated his challenge, claiming he wouldn’t say until “after I consult with the prime minister [Putin].” “You know what — ” Medvedev shot back. “You can consult anyone you like, including the prime minister. But as long as I am president, the decisions, like this one, are up to me.” Kudrin’s “irresponsible charter”, the president declared, he would “put a lid on”. This was the most direct, public firing in Russian political history.

The Financial Times declared[9] it to be “a disaster, at least for investor perception. There is no one who can replace him.” Read more[10].

Days later, at a bankers’ conference[6] on October 6, 2011, Putin abandoned Kudrin. He was “definitely one of the best specialists, not only in Russia but in the world as well,” Putin said. Also, “he is our very personal and my good friend.” He and Kudrin had had the talk Kudrin had threatened Medvedev with. But the outcome was the same. Kudrin was suffering an “emotional breakdown” – he deserved to be sacked, Putin made clear, and would stay so if he refused to be “a member of our team”.

Every year since then Kudrin has leaked to the trans-oceanic press that he’s about to be appointed in place of Medvedev. He’s the friend of Russian and US capital; he’s the enemy of the Russian military, he’s said, and he may be aiming even higher than the prime ministry.

In December[11] he called in two reporters from Michael Bloomberg’s (below, left) organization to reveal that he’s had a fresh round of meetings with Medvedev and Putin. According to Irina Reznik and Ilya Arkhipov (right), “the talks are the most advanced since Kudrin, widely respected by investors for his fiscal discipline and commitment to market reforms, quit as finance minister in 2011, the people [sic] said.” Bloomberg had failed to read its own archive, and given away Kudrin’s game. He said he had “quit”. He said he was ready for a comeback – on his terms.

According to Bloomberg, “Russian business leaders have lobbied for the appointment in discussions with senior government officials, as well as with Kudrin himself, according to people familiar with the conversations. Among the posts under consideration for Kudrin are a senior slot in the presidential administration, where he would coordinate economic policy, and a position as a top deputy to Medvedev, according to the people familiar with the situation. No final decision has been made and there are some important Kremlin figures opposed to Kudrin’s return, the people said.”

Kudrin didn’t mention US sanctions, the cutoff of capital for Russian banks, or the war to overthrow Putin. He told Bloomberg he is opposed to the Russian military, and to spending on the two war fronts – Ukraine and Syria. According to Bloomberg, “Kudrin also reiterated his longtime criticism of high military spending, noting that while the air campaign in Syria is likely to be relatively low cost, procurement of new weapons is a major burden on the budget.”

In a parallel interview with Vedomosti[12], Kudrin went further, attacking Russian strategy against Turkey. He also hinted that he is on Washington’s side, warning against “the risks of unintended incidents that could worsen our relations with the countries [which are] partners of Russia.”

To the Kremlin and the White House, Kudrin was declaring war against the new men who have acquired authority in Russian strategy since the NATO alliance declared itself for Russian regime change. Their names aren’t well known, yet. For the moment, Kudrin was also declaring himself Putin’s successor against Kremlin chief of staff Sergei Ivanov (below left), Defense Minister Sergei Shoigu (centre), and Deputy Prime Minister for the military industrial complex, Dmitry Rogozin (right).

Kudrin is going to fail, reports an international banker well-known in Moscow who met with senior Russian businessmen last week. “He can be an advisor, no more. He is not a prime minister in waiting.” Putin’s spokesman Dmitry Peskov warned Bloomberg: “He’s not being appointed to anything yet.”

This week, Medvedev’s spokesman, Natalia Timakova, told Vedomosti[13] that Kudrin had been in to see Medvedev, but she declined to say he will be going anywhere else.

Kudrin is bluffing with a weak hand, US investors and Kremlin sources agree. “The value he used to have for Putin,” says one source requesting anonymity, “was that he was the door-opener for US capital, the IMF, the international banks. That’s gone now. Even Putin has been obliged to accept that.” A well-known US banker told Russian company chiefs this month there is “a tsunami of money” waiting to flow back into Russia. The Russians laughed when the banker had left the room. “Kudrin’s promise to Putin is American money for a palace coup. He’s crazy,” a person familiar with Kudrin’s discussions with Medvedev and Putin said on Monday.

By Monday of this week, Kudrin’s suppporters were acknowledging consolation prizes he cannot accept – a subordinate[13] of Ivanov’s in the Kremlin; a deputy prime minister under Medvedev. “What is important is not the chair itself,” Kommersant reported Andrei Nechaev (right), a Kudrin protégé in government and now the head of his Grazhdanskaya Initsiativa (Civil Initiative) organization, as conceding. “But certainly it should be adequate.” He implied that Kudrin is standing for business and the US against the General Staff, the intelligence services, Crimea, Novorussia, the Syrian and Turkish wars. “It’s for sure that Alexey Leonidovich will try to bring order to the budgetary process and that will improve the business and investment climate in Russia. And maybe that will irmpove the relations with our western partners, I think this is obvious. But, probably, you can’t be a genius in all these areas. Nobody can.”

Kudrin employs two spokesmen – Anastasia Urnova and Pavel Kuznetsov. Through them this week Kudrin was asked the following questions: Does he believe he can restore Russia’s access to US capital? How? Why does he think Russia should cut its defence spending? If he is not given the government job he wants, will he stop advertising for it as he has done each year since he was fired?

Kudrin refuses to answer. According to Kuznetsov, Kudrin is too busy performing at the annual convention of the Yegor Gaidar Fund and Gaidar Institute for Economic Policy. Kudrin is chairman of the Institute’s board of trustees. He has invited Anatoly Chubais to speak[14] on the future of Russia. Regime change, sanctions, capital controls, and Russia’s defence are not on the programme[15].